The
occurrence of any accident will cause both direct and indirect costs.
It is important that all of these costs are taken into account when
the full cost of an accident is calculated. Different studies shown
that indirect costs or hidden costs could be more than 30 times
greater than direct costs of an accident. In other words, the direct
costs of an accident or disease represent the tip of the iceberg when
compared to the overall costs.

Direct
costs

These
are costs that are directly related to the accident and may be
insured or uninsured.

Insured
direct costs, normally include:

claims
on employers and public liability insurance

damage
to buildings, equipment or vehicles

any
attributable production and/or general business loss.

Uninsured
direct costs, normally include:

fines
resulting from prosecution by the enforcement authority

sick
pay

some
damage to product, equipment, vehicles or process not directly
attributable to the accident (e.g. caused by replacement staff)

increases
in insurance premiums resulting from the accident

any
compensation not covered by the insurance policy due to an excess
agreed between the employer and the insurance company

legal
representation following any compensation claim.

Indirect
costs

Indirect
costs are costs which may not be directly attributable to the
accident but may result from a series of accidents.

Insured
indirect costs, typically include:

a
cumulative business loss

product
or process liability claims

recruitment
of certain replacement staff.

Uninsured
indirect costs, can include:

loss
of goodwill and a poor corporate image

accident
investigation time and any subsequent remedial action required

production
delays

extra
overtime payments

lost
time for other employees, who attend to the needs of the injured
person

the
recruitment and training of most replacement staff

additional
administration time incurred

lower
employee morale possibly leading to reduced productivity

Some
of the items mentioned above, such as business loss, may be
uninsurable or too prohibitively because of the big amount of money
required.